NZ Economy Beats Expectations, But Growth Remains Sluggish Amid Global Headwinds
New Zealand's economy expanded more than anticipated in Q2, according to Statistics New Zealand data released on Thursday. The country's GDP grew by 0.2% quarter-on-quarter, surpassing analyst expectations of 1% growth and the Reserve Bank of New Zealand's forecast of no growth.
Despite this improvement, overall growth remained sluggish due to the ongoing Middle East conflict. The U.S.-Israel war with Iran led to increased oil prices and heightened economic uncertainty, which weighed on New Zealand's economy in Q2.
The Reserve Bank of New Zealand had raised the official cash rate by 25 basis points to 2.75% earlier this month, marking the second consecutive meeting with an increase. The central bank expects the economic recovery to strengthen and become more broad-based.